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Administrator Guide
Last Updated: 2025-11-14
Concept: Retro and Pay Balances

Concept: Retro and Pay Balances

You can configure pay balances to:
  • Include all retro differences in the current balance period regardless of the period earned.
  • Only include the retro differences that fall within the pay balance period.
  • Exclude all retro differences for pay components that you don't calculate in retro.
Workday recommends that you don't change existing pay balances that you process in retro. Instead, create pay balances with a new effective date. This practice helps ensure accurate retro pay calculations.

Retro Calculation Examples

The balance period is January through December. Susan receives an ongoing monthly bonus of 100. In March of the current balance period, you enter:
  • A 50 retro bonus for December in the previous year.
  • A 25 retro bonus for January.
Depending on how you want to include retro values, you could configure the pay balance in 3 different ways:
Include All Retro Values in Current Gross to Net
Workday includes the bonuses regardless of the source period. The pay balance in March is:
100 (January ongoing bonus) + 100 (February ongoing bonus) + 100 (March ongoing bonus) + 50 (December bonus) + 25 (January bonus) = 375
Include All Retro Values Based on Earned Period
Because Susan earned the 50 bonus before the current balance period, Workday excludes it. The pay balance in March is:
100 (January ongoing bonus) + 100 (February ongoing bonus) + 100 (March ongoing bonus) + 25 (January bonus) = 325
Exclude Values from Current Gross to Net During Calculation
 and
Include All Retro Values Based on Earned Period
Workday:
  • Excludes the current period ongoing bonus.
  • Excludes the December bonus because Susan earned it before the current balance period.
  • Includes the January bonus because it's paid in the current balance period.
The March pay balance is:
100 (January ongoing bonus) + 100 (February ongoing bonus) + 25 (January bonus) = 225
If you have a pay component that references a pay balance and is set to recalculate during retro, Workday recommends specifying
Include All Retro Values Based on Earned Period
 on the pay balance rather than
Include All Retro Values in Current Gross to Net
 to ensure that any retro amounts in your related calculations calculate correctly.

Exclude Retro Values Examples

Exclude Retro Values from Balances for Pay Components that Calculate in Retro
To configure a pay balance to exclude retro amounts, select the
Include All Retro Values Based on Earned Period
 option and select a
Balance Period
 of
Current Period
.
This exclusion only works when the pay component that uses the pay balance is configured to calculate in retro.
Exclude Retro Values from Balances for Pay Components that don’t Calculate in Retro
To exclude all retro values, create an arithmetic calculation that uses 2 different pay balances.
Example: You have a deduction that doesn't
Recalculate during Retro
. The
Calculation
 on that deduction is a percentage of an earning that does recalculate in retro (excluding retro amounts).
  1. Set up
    Pay Balance 1
    , based on the earning, and select these values:
    • The
      Include All Retro Values in Current Gross to Net
       option.
    • A
      Balance Period
       of
      Current Period
      .
  2. Set up
    Pay Balance 2
    , based on the earning, and select these values:
    • The
      Exclude Values from Current Gross to Net During Calculation
       check box.
    • The
      Include All Retro Values in Current Gross to Net
       option.
    • A
      Balance Period
       of
      Current Period
      .
  3. Access the
    Create Arithmetic Calculation
     task and complete these fields:
    1st Operand
    Operator
    2nd Operand
    Pay Balance 1
    Subtract
    Pay Balance 2